Somali - Second Education Project : Credit 0511 - Credit Agreement - Conformed

CONFORMED COPY CREDIT NUMBER 511 SO Development Credit Agreement (Second Education Project) BETWEEN SOMALI DEMOCRATIC REPUBLIC AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED SEPTEMBER 19, 1974 CONFORMED COPY CREDIT NUMBER 511 SO Development Credit Agreement (Second Education Project) BETWEEN SOMALI DEMOCRATIC REPUBLIC AND INTERNATIONAL DEVELOPMENT ASSOCIATION DATED SEPTEMBER 19, 1974 DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated September 19, 1974, between SOMALI DEMOCRATIC REPUBLIC (hereinafter called the Borrower) and INTERNATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Association). ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated March 15, 1974, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agreements of the Association being hereinafter called the General Conditions). Section 1.02. Whenever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions have the respective meanings therein set forth. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equivalent to eight million dollars ($8,000,000). Section 2.02. The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of Schedule I to this Agreement, as such Schedule may be amended from time to time, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project described in Schedule 2 to this Agreement and to be financed out of the proceeds of the Credit. Section 2.03. Except as the Association shall otherwise agree, contracts for the purchase of goods, the carrying out of works or services (other than consultants' services) for the Project and to be financed out of the proceeds of the Credit, shall be awarded in accordance with the provisions of Schedule 3 to this Agreement. 4 Section 2.04. The Closing Date shall be June 30, 1980, or such other date as shall be agreed between the Borrower and the Association. Section 2.05. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. Section 2.06. Service charges shall be payable semi-annually on March 15 and September 15 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semi-annual installments payable on each March 15 and September 15 commencing September 15, 1984, and ending March 15, 2024, each installment to and including the installment payable on March 15, 1994 to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter to be one and one-half per cent (1-1/2%) of such principal amount. Section 2.08. The currency of the United States of America is hereby specified for the purposes of Section 4.02 of the General Conditions. ARTICLE III Execution of the Project Section 3.01. The Borrower shall carry out the Project with due diligence and efficiency and in conformity with appropriate administrative, financial, educational and technical practices, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. Section 3.02. For the purpose of carrying out the Project, the Borrower shall (a) employ the following staff in its Project and School Design Units established under the Ministry of Education: (i) a project director; (ii) a deputy project director; (iii) two architects or civil engineers experienced in the type of construction included in the Project; (iv) a quantity surveyor; 5 (v) a procurement officer; (vi) an accountant or experienced bookkeeper; (vii) two building inspectors for site supervision work; and (viii) adequate auxiliary staff; and (b) provide all equipment and furniture necessary for efficient working conditions of the said units. Section 3.03. The Borrower shall provide the Association with details of courses to be offered at the Nomadic Training Centers as well as courses for the instructors of said centers sufficiently in advance for the Association to give its comments. Section 3.04. The Borrower shall exchange views regularly with the Association on the work program of the Academy of Somali Studies and shall furnish to the Association the Annual Reports of said Academy for its comments during the first five years of its operation. Section 3.05. The Borrower shall cause its Nomadic Education Board to regularly evaluate the operations of the Nomadic Training Centers and shall submit Annual Reports of said Centers to the Association for its comments during the first five years of Project operation. Section 3.06. In carrying out the civil works under Part A of the Project, the Borrower shall employ or cause to be employed contractors acceptable to the Association upon terms and conditions satisfactory to the Association. Section 3.07. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. (b) Except as the Association shall otherwise agree, the Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the Project. 6 Section 3.08. (a) The Borrower shall furnish to the Association, promptly upon their preparation, the plans, specifications, reports, contract documents and construction and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. (b) The Borrower: (i) shall maintain records adequate to record the progress of the Project (including the cost thereof) and to identify the goods and services financed out of the proceeds of the Credit, and to disclose the use thereof in the Project; (ii) shall enable the Association's accredited representatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Credit and any relevant records and documents; and (iii) shall furnish to the Association all such information as the Association shall reasonably request concerning the Project, the expenditure of the proceeds of the Credit and the goods and services financed out of such proceeds. Section 3.09. The Borrower shall take or cause to be taken all such action as shall be necessary to acquire as and when needed all such land and rights in respect of land as shall be required for the construction (and operation) of the facilities included in the Project and shall furnish to the Association, promptly after such acquisition, evidence satisfactory to the Association that such land and rights in respect of land are available for purposes related to the Project. Section 3.10. The Borrower shall maintain or cause to be maintained records adequate to reflect in accordance with consistently maintained appropriate accounting practices the operations, resources and expenditures, in respect of the Project, of the departments or agencies of the Borrower responsible for carrying out the Project or any part thereof. Section 3.11. The Borrower shall cause the buildings, furniture and equipment of the educational institutions included in the Project to be adequately maintained and shall cause all necessary renewals and repairs thereof to be made. ARTICLE IV Termination Section 4.01. The date December 19, 1974 is hereby specified for the purposes of Section 12.04 of the General Conditions. 7 ARTICLE V Representative of the Borrower; Addresses Section 5.01. The Secretary of State for Finance of the Borrower is designated as representative of the Borrower for the purposes of Section 11.03 of the General Conditions. Section 5.02. The following addresses are specified for the purposes of Section 11.01 of the General Conditions: For the Borrower: The Secretary of State for Finance Government of the Somali Democratic Republic Mogadiscio Somali Democratic Republic Cable address: MINFIN Mogadiscio For the Association: International Development Association 1818 H Street, N.W. Wishington, D.C. 20433 United States of America Cable address: INDEVAS Washington, D.C. IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed 8 in their respective names in the District of Columbia, United States of America, as of the day and year first above written. SOMALI DEMOCRATIC REPUBLIC By /s / Abdullahi Ahmed Addou Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By /s / S. Shahid Husain Regional Vice President Eastern Africa 9 SCHEDULE 1 Withdrawal of the Proceeds of the Credit 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Credit, the allocation of the amounts of the Credit to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Credit Allocated % of (Expressed in Expenditures Category Dollar Equivalent) to be Financed I. Civil Works 3,700,000 74% II. Furniture 400,000 (a) Directly 100% of foreign imported expenditures (b) Locally manu- 95% of local factured (ex- expenditures factory cost) (c) Local trans- 90% of local portation expenditures III. Equipment 1,160,000 (a) Directly 100% of foreign imported expenditures (b) Local trans- 90% of local portation expenditures IV. Project Admini- 100,000 100% of foreign stration expenditures and 90% of local ex- penditures V. Technical assis- 640,000 100% of foreign tance expenditures, and 90% of local ex- penditures VI. Unallocated 2,000,000 TOTAL 8,000,000 10 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures for goods or services supplied from, the territory, and in the currency, of any country other than the Borrower; and (b) the term "local expenditures" means expenditures in the currency of the Borrower, and for goods or services supplied from, the territory of the Borrower. 3. The disbursement percentages have been calculated in compliance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if any event occurs which shall affect the amount of any such taxes included in the cost of any item to be financed out of the proceeds of the Credit, the Association may, by notice to the Borrower, correspondingly adjust the disbursement percentage then applicable to such item. 4. Notwithstanding the provisions of paragraph I above, no withdraw.-". shall be made in respect of expenditures prior to the date of this Agreement. 5. Notwithstanding the allocation . of an amount of the Credit or the disbursement percentages set forth in the table in paragraph I above, if the Association has reasonably estimated that the amount of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Category, the Association may, by notice to the Borrower: (i) reallocate to such Category to the extent required to meet the estimated shortfall proceeds of the Credit which are then allocated to another Category and which in the opinion of the Association are not needed to meet other expenditures, and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 6. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expenditures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way restricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as in the Association's reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. 11 SCHEDULE 2 Description of the Project The Project is part of the Borrower's education development program and consists of the following components: Part A: Educational and Training Facilities, Furniture and Equipment Construction of new facilities for, extensions to, and/or provision of equipment for, training institutions, and the carrying out of education and training programs, as follows: (1) Academy of Somali Studies The expansion and rebuilding of the Academy of Somali Studies, these facilities to include staff offices, language laboratory, library and audio-visual workroom. (2) Elementary Teacher Training Construction of, equipment and furniture for an 800-student capacity elementary teacher training college, these facilities to include student hostels, staff housing and communal services. (3) Secondary Schools Provision of additional buildings, furniture and equipment for pre-vocational, agricultural, handcrafts and domestic science training in selected general secondary schools and the rebuilding of the Fishery and Marine Institute where student hostels and a staff house would be included. (4) Nomadic Training Construction of, equipment and furniture for ten Nomadic Training Centers, all sites to be finalized following surveys; these facilities to include student hostels, staff housing and the required communal services. Part B: Technical Assistance (1) Technical assistance to provide for the staffing of the management of the Project through the Project and School Design Units. 12 (2) Technical assistance to provide for the staffing of the Fishery and Marine Institute. The Project is expected to be completed by December 31, 1979. 13 SCHEDULE 3 Procurement A. General Procedures 1. Except as provided in Part A(3) hereof, contracts shall be let under procedures consistent with those set forth in the "Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in April 1972, as revised in October 1972 (hereinafter called the Guidelines), on the basis of international competitivc bidding. 2. (i) Bidders for the civil works included in Part A of the Project shall be prequalified as described in part 2.2 of the Guidelines. (ii) Civil works contracts under Part A(3) other than the fishery and marine institute shall be awarded following competitive bidding after advertising only in Somalia. (iii) Civil works contracts for Part A of the Project shall not require prior review by the Association unless they exceed $150,000 equivalent. (iv) Contracts for instructional equipment and furniture under Part A of the Project shall not require prior review by the Association unless they exceed $40,000 equivalent up to an aggregate total of $200,000 equivalent. 3. Contracts for the procurement of instructional equipment, books, and furniture costing less than $30,000 equivalent each may be awarded on the basis of local competitive bidding in accordance with the contracting procedures acceptable to the Association, provided, however, that the aggregate cost does not exceed $100,000 equivalent. B. Evaluation and Comparison of Bids for Goods; Preference for Domestic Manufacturers 1. For the purpose of evaluation and comparison of bids for the supply of goods: (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for imported goods, or the ex-factory price for domestically-manufactured goods; (ii) customs duties and other import taxes on imported goods, and sales and similar taxes on domestically-supplied goods, shall be excluded; and (iii) the 14 cost to the Borrower of inland freight and other expenditures incidental to the delivery of goods to the place of their use or installation shall be included. 2. Goods manufactured in Somalia may be granted a margin of preference in accordance with, and subject to, the following provisions: (a) All bidding documents for the procurement of goods shall clearly indicate any preference which will be granted, the information required to establish the eligibility of a bid for such preference and the following methods and stages that will be followed in the evaluation and comparison of bids. (b) After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A: bids offering goods manufactured in Somalia if the bidder shall have established to the satisfaction of the Borrower and the Association that the manufacturing cost of such goods includes a value added in Somalia equal to at least 20% of the ex-factory bid price of such goods. (2) Group B: all other bids offering goods manufactured in Somalia. (3) Group C: bids offering any other goods. (c) All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes on goods to be imported and any sales or similar taxes on goods to be supplied domestically, to determine the lowest evaluated bid of each group. The lowest evaluated bid of each group shall then be compared with each other, and if, as a result of this comparison, a bid from group A or group B is the lowest, it shall be selected for the award. (d) If, as a result of the comparison under paragraph (c) above, the lowest bid is a bid from group C, all group C bids shall be further compared with the lowest evaluated bid from group A after adding to the c.i.f. bid price of the imported goods offered in each group C bid, for the purpose of this further comparison only, an amount equal to (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of the goods offered in such group C bid, or (ii) 15% of the c.i.f. bid price of such goods if said customs duties and taxes exceed 15% of such price. If the group A bid in such further comparison is the lowest, it shall be selected for the award; if not, the lowest evaluated bid from group C shall be selected. 15 C. Evaluation and Comparison of Bids for Civil Works; Preferences for Domestic Contractors 1. With respect to any contract for civil works included under Category I of the table set forth in Schedule 1 to the Credit Agreement, the Borrower may grant a margin of preference of 7-1/2% to domestic contractors, in accordance with, and subject to, the following provisions: (a) Contractors shall be required to prequalify as provided in Part A of this Schedule and applicants for qualification applying also for such preference shall be asked to provide, as part of the information for qualification, such information, including details of ownership, as shall be required to determine whether, according to the classification established by the Borrower and accepted by the Association, a particular firm or group of firms qualifies for a domestic preference. The bidding documents shall clearly indicate the preference and the method that will be followed in the evaluation and comparison of bids to give effect to such preference. (b) After bids have been received and reviewed by the Borrower, responsive bids will be classified into the following groups: (i) bids offered by domestic contractors eligible for preference; and (ii) bids offered by other contractors. For the purpose of evaluation and comparison of bids an amount equal to 7-1/2% of the bid amount shall be added to bids received under group (ii) above. D. Review of Procurement Decisions by Association 1. The Borrower shall, before qualification is invited, inform the Association in detail of the procedure to be followed and shall introduce such modifications in said procedure as the Association shall reasonably request. The list of prequalified bidders, together with a statement of their qualifications and, where applicable, of their eligibility for domestic preference under Part C. 1 above and of the reasons for the exclusion of any applicant for prequalification and for such eligibility shall be furnished by the Borrower to the Association for its comments before the applicants are notified, and the Borrower shall make such additions to, deletions from, or modifications in, the said list as the Association shall reasonably request. 2. Review of invitation to bid and of proposed awards and final contracts: 16 With respect to all contracts for civil works and equipment estimated to cost the equivalent of $150,000 or more: (a) Before bids are invited, the Borrower shall furnish to the Association, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or procedures as the Association shall reasonably request. Any further modification to the bidding documents shall require the Association's concurrence before it is issued to the prospective bidders. (b) After bids have been received and evaluated, the Borrower shall, before a final decision on the award is made, inform the Association of the name of the bidder to which it intends to award the contract and the reasons for the intended award and shall furnish to the Association, in sufficient time for its review, a detailed report on the evaluation and comparison of the bids received, together with the recommendation for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the intended award would be inconsistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked or prequalification invited. (d) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract. 3. With respect to each contract to be financed out of the proceeds of the Credit and not governed by the preceding paragraph, the Borrower shall furnish to the Association, promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of bids, recommendations for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination.